Myti Pet - Rawmat Representative

Analysis Questions: Myti-Pet Case

Negotiation

Rawmat Representative

1. What is your BATNA? Explain.

Because this is a multifaceted agreement, I have several alternatives to a negotiated agreement, depending on which negotiated item we are talking about.

 If no consensus can be made on the outstanding $250,000 Myti-Pet owes, my BATNA is to sue Myti-Pet for the outstanding balance

 I would like to sell additional volume in the meat line to be able to justify tighter specifications on the product variances- If we cannot come to an agreement on adding additional volume, my BATNA for that is to continue where we are with our current volume and product variance specs (or lose the customer completely)

 I would like to add an additional business line of selling wheat flour to Myti-Pet. This would help to generate enough volume to reopen the Chicago plant. My BATNA is to not have this additional line of business with Myti-Pet. The Chicago plant will still likely open due to some other things in the works.

 I would like to have Myti-Pet agree to two daily deliveries to help me reduce costs. My BATNA is to maintain the once daily schedule.

2. How attractive is that BATNA to you? What does the attractiveness of your BATNA suggest about how you might approach the negotiation?

My overall BATNA is not very attractive to me. Not only do I stand to lose more than 20% of the $250,000 in lawyer fees, I also do not want the negative press that goes along with a lawsuit. Further investigation might also shed light on the fact that some of our plants exploit the bandwidth of water content to reduce costs which could hurt the company's image.

Due to the unattractiveness of my BATNA, I may be willing to accept less than the $250,000 currently owed in order to save on lawyer fees and maintain the company's image. Because of this, I will likely focus more on the relationship mending and take a less combative approach to getting the money owed.

3. What will be the general tone you would like to use in the conversation? (Examples--and only intended as examples--might be hysterical, remorseful,

I would characterize my general tone to be "cautiously apologetic". Even though Myti-Pet is not one of my top customers, they still help to generate revenue and stand to be even better customers in the future as they continue to grow. Because we have sold them a product that is outside of specifications that we outlined in our contract, we should accept responsibility for what has happened in the past and offer solutions that will help both parties in the future.

4. What are the key risks you see for your company in this negotiation? How might a final agreement be structured to protect you against those